Ladies and gentlemen, good day, and welcome to the TCNS Clothing Co. Limited Q1 FY 2023 earnings conference call. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions, and expectations of the company as on date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in listen only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star and zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Anant Daga, Managing Director, TCNS Clothing Co. Limited. Thank you, and over to you, Mr. Daga. Thank you. Good evening, and welcome to Q1 FY 2023 earnings conference call to discuss operational and financial performance for the quarter. I am joined by Amit, our CFO, and SGA, our investor relations advisors. While Amit can share detailed financials, let me share some key highlights for Q1, our perspective on the emerging situation, and progress on key focus areas for FY 2023. Starting with our outlook on the emerging market situation. Over the last few months, it has been really encouraging to see multiple categories getting back to normalcy as consumers are indulging in fashion once again. We believe with the onset of festive season and reopening of offices, the ethnic women's fashion segment should also come back to full normalcy soon. Given that over the last two years there have been multiple restrictions around festivities and gatherings, and hence a lower indexing of ethnic wear, we now see the consumers pressing the refresh button this festive season for their wardrobes. This festive season should set the ball rolling for women's ethnic wear segment. As you are aware, even as a business, our focus during the COVID period has been on balance sheet conservation. We are very happy to share that now, after a gap of two and a half years, we are leveraging this balance sheet strength and taking an aggressive bet on the market. We are back to doing what we do best, launch comprehensive fashion-forward ranges. At this time, we have had one of the earliest season launches that we have done in the recent past. This will be backed by digital-first marketing campaign, which cuts across online and offline channels, marketing tie-ups with key partners, and a whole new retail identity for W in some of the top markets across the country. Given the emerging external buoyancy and our internal readiness, we should see our best festive seasons coming forward. Coming to our performance for Q1 2023, despite overall slower segment recovery, our Q1 revenues grew 3x year-on-year to reach pre-COVID Q1 sales. While the overall offline same-store recovery is still lagging behind, we are already seeing couple of regions tracking ahead of pre-COVID numbers, and the remaining ones are gradually catching up. We are excited to see significant sales spikes around regional festive occasions, and we see this recovery further building on. In this quarter, we opened 17 stores on a net basis to reach a total count of 616. In addition to these 17 stores, we have upgraded another six stores under Project Tribe initiative, taking the Project Tribe initiative stores tally to 20. Ambyo business is back on track with a strong order book in place. Online on a secondary sales basis continued to grow this quarter despite a large base in Q1 last year. Specifically, the brand website scaled up faster at a rate of 35% over last year. While the recorded book sales are lower, it is more of a primary and secondary sales phasing issue that we have seen in the past quarters as well. Talking about key focus areas for FY 2023, as we had highlighted in the last call, our primary agenda in FY 2023 is accelerating growth. Let me share an update on some of the key growth drivers. First focus area is store expansion, both upgradations and new additions. For Project Tribe, our flagship store upgradation initiative, we have already opened 20 stores across strategic markets in the country. Barring a couple of stores, all the remaining stores are tracking ahead of expectation and are already clocking 1.5x-2x sales. This growth, despite overall recovery being slightly slower, obviously is encouraging for us. We are now going to double down on this initiative further. Now we have a Project Tribe store closer to people who are in Mumbai. I would request you to please visit our Linking Road store to experience the new retail identity of W and see how our various concepts and various categories that we have incubated over last year and half have come together. With the success of this concept, we are now working on a new retail identity for Aurelia as well, which will be unveiled shortly. With respect to new store additions, we have opened 17 stores in Q1 on a net basis, and we have another 15 stores in pipeline. In Q2, we are targeting to open 25 stores on net basis, plus Project Tribe store upgradations. As of now, we are firmly on track to open 100+ new stores on a net basis and have 35 Project Tribe upgradations in FY 2023. Second focus area for us is online. With the reorientation of the marketplace towards D2C, we are now aiming to build online channel as a primary sales channel for future. In Q1, the brand website grew by 35% year-over-year. Omnichannel fulfillment scaled up to 10% of overall online business with addition of more marketplace partners. In line with our strategy of building online as a primary sales channel, we will be creating online first products, integrating additional platforms through omni-channel model, upgrade the website experience, and invest in digital first campaigns. We see online as a key revenue driver and are looking at accelerated scale-up, especially in B2C space. Coming to new launches, as discussed on the last call also, this is the first season which will see broader rollout of all new initiatives. While we will have more meaningful update on these by the end of festive season, let me quickly share a few developments. Brand Elleven saw addition of four stores, taking the total count to 21. The new store opened with our initial set of learnings are seeing better traction and should see the scaling up in the coming season. On footwear, the category continues to build consistently both in EBO and online channel. Most of these new initiatives are constrained by existing store sizes, and with the opening of new bigger stores, we should see full representation of footwear and accessories. We are committed to reaching an annual run rate of INR 100 crores on consumer sales by the end of 2023 for the new formats cumulatively. All in all, we are excited with the upcoming festive season. There are multiple initiatives along with an on-time comprehensive new season launch after the last few disrupted seasons will come together for the consumers. Now, I would request Amit to share key financial highlights for the quarter. Thanks, Anant. Good evening, everyone. Let me share the update on our financial performance for FY 2023 Q1. Our Q1 revenues were INR 276 crores, which is a growth of 195% over our FY22 Q1 revenues of INR 94 crores and a growth of 18% over FY22 Q4 revenues of INR 234 crores. Our gross margin for the quarter was 69.1% versus 55.8% last year in FY22 Q1, and 68.9% in FY22 Q4. We have mentioned earlier, we should see the gross margin metric in conjunction with selling and distribution expenses and other overheads, as every channel has its own ramp in terms of revenue recognition, gross margin percentages and costs reflecting in selling and distribution expenses or other overheads. Accordingly, based on the channel mix, these metrics could vary in a range from quarter to quarter. For Q1, the company generated a positive EBITDA of INR 38 crore versus last year's Q1 EBITDA loss of INR 20 crore. PBT for the quarter was INR 2.6 crore versus a loss of INR 49 crore in last year's Q1. PAT for the quarter was INR 2.4 crore versus a loss of INR 36 crore last year Q1. During the quarter, the company added 17 exclusive brand stores to its tally, taking the store count to 616 stores. Additionally, we have 2,492 points of sale in LFS channel and roughly 1,100 points of sale in the MBO channel. This is the financial update from our side. We are now open to questions. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use hands-free while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Rakesh Wadhwani from Monarch Networth Capital. Please go ahead. Am I audible? Yes, you are. Yeah. Thanks for the opportunity. I wanted to ask, have you taken any price hike in this quarter? Because the gross margins have improved. Is it because of the online channel mix or because we have taken some price hike for the product? No. Again, as Amit was mentioning, I think it should be seen in conjunction with selling and distribution expenses as well. While we have maintained the gross margins in that range, I don't think there's any significant change. Second question, you are talking about price increases. Yes, there has been a single-digit price increases across select capsules. Okay. One more question. When you're talking about omni-channel and online sales, just wanted to clarify, in online as a W brand or TCNS, we'll be selling directly to the customer, or it will be like a third party? No. We have these models both. We sell through our own websites also, and we have both B2B and B2C model working with all the leading marketplaces as well. When we are talking about online sale, is it through our own platform, our own website, or is it through third parties also when you talk about online sales? It's both. We have our own website, and we also sell from all the verticals and horizontal platforms. Can you just give us a rough idea what is the percentage of sales we are doing from our own website? Because you used to mention earlier this. Our own website is about 20%-22% kind of range, and the rest will be marketplaces. In marketplaces also, if you take the B2C model, it will be higher than the B2B part. Oh, okay. Thank you. I'll come back to you. Thank you. Thank you. Participants, if you wish to ask any questions, please enter star and one. The next question is from the line of Devanshu Bansal from Emkay Global Financial Services. Please go ahead. Yes, sir. Hi, thanks for the opportunity. Amit, you mentioned that you expect a festive season this year. Can you also throw some more light on this in terms of same-store sales recovery? Because obviously, better festive season can also be due to higher store addition versus earlier periods. Just on same-store sales recovery, what are your expectations for this year? It would be really helpful. Sure. Again, see, we'll have to see how exactly festive builds up. But if, you know, if I talk about any category wherein the occasion usage trigger has been, has played out, I think most of the categories are seeing a double-digit kind of SSSG recoveries compared to FY20. I guess that is the range of expectation that one should have from SSSG come festive. Sure, sir. Online revenues over the last two quarters have been relatively lower, much lower in fact, versus what we did over the previous year. What is the reason for slower traction here, number one? Secondly, I guess with D2C sales, with higher component of D2C sales, you recognize the entire top line. That should also sort of help here in terms of online revenues, but our revenues have been sort of lower. Can you throw some light here? Actually two things. Maybe the second part, Amit can answer better, but let me just take the first part. You know there are two ways to look at it. One is obviously on the purely secondary sales basis. On secondary sales basis, even on the last year base, which was very, very high because of offline disruption, we have been able to grow upon that. Now, one big reason where you see book sales to be lower is because of the primary phasing. In the past also we had said, I think we should look at one half rather than a quarter, because this time also a lot of those primaries would happen in Q2. I think that will probably, you know, cover a lot of gap that you are seeing right now. Q4 last year was a very different issue. It was a one-time alignment, so obviously that was a very different issue. Right now it's just about the phasing issue. Okay. Your channel mix- Sorry, have I answered your question? Am I clear on this part? Yes, Anant, but on this D2C component of online, can you throw some light? Maybe Amit can contribute here. Yeah. You are right. The revenue recognition is different when you look at B2B part of the online revenue versus the B2C. See, major component of, you know, let me clarify how B2C is booked. B2C is where we do the billing into the direct consumer, and there is a commission that sits in our selling and distribution expenses, right? When it comes to own website, there may be other cost elements as well, which may sit in marketing or overheads, depending on what that component is. There is revenue recognition in case of B2C is a bit higher. If you compare the share of B2C for us over the last 4-5 quarters, it has consistently been in the range of anywhere between 50%, and then it started becoming the majority share of our online revenue. That trend is continuing. There's not much of a difference in the B2C share over the last, I'll say Q4 quarter. Obviously, the mix has changed significantly as when you compare it with two quarters back, two years back or what was pre-COVID, but last 4-5 quarters has been fairly similar. Okay. That's it. Got it. Versus Q1 FY20, your channel mix was broadly similar, but our gross margins are about 200 basis points higher. Can you sort of help us understand what led to this gross margin gains versus Q1 FY20? You know, this is something that we have tried explaining earlier as well. Gross margin as a metric has multiple components, you know, which affect that number, right? There's a channel mix, and within each of the channels that we operate in, again, there are, you know, different components. Like I'll give you an example in case of PPO. There could be, you know, own store versus franchisee, where again the revenue recognition will be very different. Within franchisee also we have different type of formats. In certain cases we may have an outright franchisee. There could be a mix of franchisees where we have an SOR understanding, where the revenue recognition happens differently and accordingly it will change the gross margin recognition as well. Similarly, we have been mentioning this, that within online the shares of B2C has gone up over the last couple of years, where revenue recognition is higher than what it was in case of B2B, and that essentially helps the gross margin as a metric. Costs, as I just mentioned, will probably sit, you know, below the gross margin line. While you are right that when you compare with Q1 FY20, our gross margin is higher, but at the same time, those costs are sitting below the line. While you're looking at the overall channel mix being the same, within each of the channels, the flavor of own versus franchisee could be different. Yeah. That is one part. Now, this is all about channel mix. Now when you look into the second component which affects the gross margin, that is the product cost and what we have been able to realize. In the last couple of quarters we have, you know, done work on reducing our old season's merchandise, which has helped us on the occupancy front as well. If you look into the gross margin that we earned in Q3 of last financial year, Q4 and even this quarter, the gross margin has also benefited from the work that we have done on the product front by reducing the occupancy bit. Got it. Anant, I just wanted to check on there has been a news report on a potential stake sale by the PE as well as promoters. While I guess you'll not like to sort of speak on the speculation. I just wanted to check on two points here. In case certain events happens, will the ESOP sort of that is linked to certain price targets does that get triggered? Secondly, in case the PE sort of decides to exit, is there a tag-along sort of feature that is there where promoters also have to sort of participate in that sort of selling? Devanshu, sure, we obviously would not like to, you know, make a remark on the market speculation, speculative news. But I'll just give clarity on the ESOP and, you know, all of it is anyway disclosed in our annual report. The ESOP scheme 2018-2023 is where a part of the ESOP that has been granted to the employees are linked to, TA exiting, at specific targets. Right. If any of that event happens, whenever it happens, and if those price targets are met, then the vesting condition will be, fulfilled and the ESOP will get vested. I guess I read it that even if TA sort of plans to exit on their own without reaching that sort of prices, then also that vesting gets triggered. Is that right? You know, our ESOP scheme 2018-2023 has various components to it, Devanshu, to be honest, and there are something which is linked to, you know, employee staying in the company. Obviously, those will get granted, vested irrespective of any event. There will be some part of the ESOP which are linked to performance. Those again will be not linked to TA exiting. You know, if you look into our annual report disclosure, and there's a component which we call threshold one ESOP pool, threshold two ESOP pool, all those are linked to TA exiting at those specific prices. Sure. On that tag-along thing, can you confirm? Devanshu, I don't think there's any clause like that, tag along and all. Anyway, see, these are simple market speculation, so all these discussions frankly are hypothetical. Sure. Sure, Anant. That's helpful. Maybe there also you can go through the annual report, and if you have more questions, we can also. We'll be happy to answer those. Sure, Anant. Sure. Bye. Thank you. The next question is from the line of Ashish Kumar from Infinity Alternatives. Please go ahead. Hi. Thanks a lot. I just wanted to understand, if I look at it, the pre-COVID, which is Q1 FY 2020, our revenues have kind of been flat through the entire three-year window. How do you really look at, let's say, over the next 2-3 years from a growth perspective, given the fact that last three years we've basically been flat? See, again, typically as a company, we don't give future guidance hints, but I'll just give you a construct which we think is very much possible in the industry we operate in. Organized ethnic wear is supposed to grow at least mid- to high-teens number over next few years. The whole shift from unorganized to organized and the market being so fragmented, I think people who are able to execute it well should be growing easily at a rate of 20%-25%+. Frankly, as an organization, that would be an aspiration. As for your point about last three years, obviously, you know, when we first spoke, even on this call, in the COVID period, our whole focus was on managing balance sheet and conserving cash, which, you know, we have done reasonably well by the end of the COVID. Our focus towards growth has just turned now on. This is the first full-fledged season that we are going to see after two and a half years. I think if executed well, the company can grow at least at those kind of rates. Would it be fair to say that because we've seen some of your listed comparables kind of grow at anywhere between 30%-100%, depending on who we are talking about. Would it be fair to say that the focus will come back on growth and what we saw pre-FY20 or pre-COVID, where we would normally exceed industry growth rates, that's something which one can expect? Frankly, you know, I don't know which listed peers you are alluding to, because if you look at women's ethnic fashion wear, I don't think we have too many listed players. Most of the times. I was more looking at the entire fashion and apparel segment rather than just. Oh, yeah. To make things very clear, you know, there are two things. One, obviously the broader market has grown pretty well, and I think that gives a lot of confidence that as and when the occasion usage and the reason to buy is coming back in different categories, different categories are taking off. For us, as we have said in the last call also, we believe festive and opening of offices are the big triggers. We should see some traction there. Coming to, you know, even if you look at most of the listed retailers, and if you look at the ethnic women's share, I think they have lagged. I think it's more a segmental recovery issue. Obviously some of our conservative view, which led us to lose probably some revenue because of better cash flow management, that is now behind us. Going forward, you should see that. Okay. Thanks, and wish you all the best going forward. Thank you. Thank you. The next question is from the line of Jignesh Kamani from GMO. Please go ahead. Hi, Anant. If you talk about first quarter, we have seen very good wedding demand and everything, and number of wedding days was very high. Somehow we are not able to see data or traction in the Wishful. Any reason why? No, if you look at, you know, two things out there. First is, Wishful is also not really wedding occasion. It's a light to a medium occasion there. In our portfolio, we really don't cater to wedding demand. For us, the bigger occasions are, you know, the Pujas, the Diwalis, and the lighter occasions. Having said that, if you look at Wishful, obviously where we were, I think we have come from the, you know, the lower point that we hit in earlier quarters, it is again coming back to historical averages. Wishful is again, the share is at 6%-7% odd, which is probably in line with, you know, pre-COVID levels and better than growth which you have seen in other brands in our portfolio. Okay. Second thing, on the Elleven, still we open only four store. Also we are still, you can say, yet to finalize the right store, right metrics, and, we have not reached the, you can say, you know, learning curve, or how is the scenario? No, there were two things, like if you remember, I think we had a chat last call also. There were two things. One is obviously the whole product consumer sharpening, and second was supply chain, which is now in place. That time also we mentioned that we'll be, you know, rolling it out full scale in this quarter. That we are on track. Second, if you remember, we had opened 14 stores earlier and we got some learnings. Based on that, we are opening another 15-16 stores. We have already opened seven stores over last four, five months, and we are opening another 7-8 stores over next 2-3 months. The stores that we have opened, about seven or eight. This is first rollout learning. They are faring far better. I think next three to four months, we'll see when all these things are coming together. This is the experience of these 14, 15 new stores. I think as discussed earlier, we'll be pressing on the accelerator by December. The supply chain, we have sorted? Yeah, yeah. The supply chain product and even the retail model, we have become sharper. It's just about, you know, these 16 stores that we are opening. I think probably you should see another 5-7 getting added in next 2-3 months. 7-8, sorry. I think with that we'll have the model also in place. Understood. Now everything has been stabilized. We need to see the proof of holding in larger, say, seven, eight, store for two or three months. Correct. In fact, what we have also done is we have tested waters in other channels also. There also we have got encouraging response. I think, you know, even in this season, despite a much bigger scale, you'll already see a significant step up in Elleven, which should get further accelerated by December once we have the model more sharpened and finalized with all the components coming into place. Understood. On the online side, you mentioned that secondary sale is pretty healthy, but primary is weak. By when it will normalize? Second thing, once, you can say, everything is normalized, primary and secondary sale moving hand in hand, or you will see some bump up in the primary sale, because of the, you can say, fulfillment at the online partner side. See, typically, you know, secondary sale growth is what has consistently come, and we think, at least in our best estimate, that, you know, there should be a 25%-30% kind of growth that we should see in the year, the way we are building this channel. Coming to your question on primary and secondary, see, it will not go hand in hand because while secondary happens throughout the year, primary happens in some bursts. It could be, you know, a mix between quarters. I think on a half yearly basis you'll get a better picture. If you take an entire year, like we have two quarters of the primary sales decline. If you take an entire year, you will see secondary and primary both growing on similar line? Yes. Understood. Thanks a lot. Thank you. The next question is from the line of Varun Singh from IDBI Capital. Please go ahead. Yeah, thank you very much. Am I audible? Yes. Yes, Varun. Okay. Thank you, sir. Sir, two questions. First, sir, I was looking at, you know, your channel mix large format store. I see that from a three-year CAGR perspective. If I look at, you know, revenue growth from three-year point of view, in large format store we have clocked 13% growth, whereas in EBOs there is a 3% decline. Also, sir, can you please, you know, help us understand why there is such a big divergence? I'm asking this question in the context that, you know, this quarter has been relatively COVID free with regards to, you know, restrictions on mobility, et cetera. Also looking at competition performance, I understand that, you know, Pujas have not happened, and hence, the first half number is what you allowed us to look at for the competitive benchmarking analysis, et cetera. Since, I mean, for the large format store, 13% is quite a healthy number, but we don't see. I mean, we see I mean, we see a negative number in case of EBO. Can you know, help us understand this divergence? Is my first question. Varun, I'm not very sure of exactly where you are getting these numbers from. In fact, if we look at our numbers, I think EBOs fared equally well or you know, it's on the similar levels as LFS. Maybe, you know, we'll have to discuss these numbers offline. I think probably we are reading a different set of numbers. Maybe you can clarify. My number is INR 116 crore revenue in current quarter from large format store and from EBO INR 156 crore, and I'm comparing these numbers from the base of Q1 FY 2020, and taking a three-year CAGR, I mean, the simple one by three calculation that I'm doing. Varun, even we are referring to the same set of numbers, I don't think this gap is there. Maybe it's okay with you if we can? Amit can probably connect with you later and sort this out. Yeah. Yeah, I think that's something we probably can do. Yeah, there's some understanding issue. Thank you. Still, sir, you wish to give some color on large format store performance, compared to EBOs' performance during current quarter? Sure, sure. In fact, this quarter, EBO has performed better. The recovery rates that we have seen in EBO, especially with, you know, new season launch being there earlier and with all the new initiatives, I think there's a positive traction in EBOs. LFS again has been a mixed bag. There are a couple of LFS where you know, the business has been far higher, and one or two LFS where, you know, overall the recoveries are slightly lower. On a channel level basis, EBOs right now Okay, sir. Understood. Okay. Sir, at brand level, you know, I see that Aurelia has performed better compared to W and Wishful. Again, you wish to ascribe some reasoning behind this outperformance of Aurelia? This you are comparing against with FY20? Yes, sir. I'm comparing on three-year period basis. I'm taking a COVID unimpacted base. I think Aurelia and Wishful both have grown, and Aurelia has benefited more from expansion compared to W. Okay. Sure, sir. Sir, on gross margin, I think we have reported the best ever gross margin based on whatever historical data that I have. You know, do we expect this level of gross margin to be maintained given our channel mix in FY 2023 and also in FY24? If possible, if you can give some direction then? No, see, because Varun, sorry. This is slightly difficult to predict because, you know, even within channel, the model change can really impact gross margin. See, suppose if in Q2 the B2B of online is higher, that will impact. I think what, you know, we believe on pre-Ind AS basis, average gross margin that we had would be in the similar range. Quarter on quarter, there will be changes, and it will be very difficult to explain. Sir, quarter on quarter it is understandable. As you know, highlighted earlier that this will be between half yearly number or an annual number. Is it on annual perspective? On annual basis, this will be closer to our historical numbers. Okay, sir. Understood. That is from my side, sir. Thank you. Thank you. Apart from the channel mix, we have complete control, so not a challenge there. Okay, sir. Okay, understood. That's it from my side, sir. Thank you. Thank you. Our participants, if you wish to ask any questions, please enter star and one. The next question is from the line of Ankit Kedia from PhillipCapital. Please go ahead. Sir, couple of questions from my side. Sir, one of the large LFS players, Central, actually closed down their stores in quarter one. What was the impact for us on that? Because some of the other brands did call out, you know, some percentage points decline in LFS because of that. We had a significant business with both Central and Brand Factory, so we were present in both the channels and I think the impact on top line would be at least, you know, in around mid-single digit number. Okay. Sir, if you look at revenue per EBO, you know, in Q1 this quarter and again pre-COVID, we are still down 6%-7%. Plus we would have taken some price hikes over three years. Is it fair to assume that, you know, the volumes, while I know you don't comment on volumes, but, or if not volumes, the footfalls at the store level, you know, are still down 20% compared to pre-COVID, or at least the footfalls are coming back and conversion is the issue today? No, sir. Right now, see, I don't think conversion is a big issue. Right now it's the footfalls. Again, you know, if you just correlate this data with any of the listed retail players, I'm trying to say listed retail players because unfortunately we don't have women's ethnic fashion focused, listed entities. If you look at all those places, I think it's not about conversion, it's more about, you know, consumers coming and consuming ethnic because of lack of occasion usage right now. It's more an issue of, you know, indulgence with this category rather than conversion. Sir, you know, if I look at pre-COVID, the number of occasions in Q1 FY 2020 to Q1 FY 2023 would not be any different, right? Is it to do with the pricing where the customers feel it's expensive, you know, the products or they are just feeling scared and preserving money? Is it something more to do with that? No. You know, there are two occasions. One was obviously festivals and second was reopening of offices and workwear. I think both have an impact on this. Frankly, Ankit, it's very difficult to pinpoint and exactly attribute reasons to this. Our sense, especially after talking to all our peers, all our channel partners, this is what it is. I'm just trying to find out what gives you confidence that the customers will come out for shopping in quarter three or quarter two, right? Very interestingly, Ankit, if you look at it, if you look at last one year, two things. One, even in our business, if you look at April, we were already tracking close to pre-COVID levels. In fact, ahead because of Eid and other festivities. A similar thing is happening in these last two weeks when Raksha Bandhan and all these things are there. In festive we are seeing that spike. That is one thing which gives tremendous confidence. Second, if you look at categories, even something like men's formal also. I think what our understanding of the market is even they have started to pick up once the offices have opened. We still believe that there's a big occasion usage trigger which has to come. Now, even when we talk to large format, and this you would know better than me because, you know, you would be dealing with all the retailers and seeing their numbers. I think while, you know, the women's ethnic share has come down, the overall women's wear pie has also come down, which is very counterintuitive. This gives us confidence, you know, that once the festivities set in, there will be a wardrobe shift to ethnic and as we've seen other categories coming into shape, this should come. Sir, do you think women are wearing more western wear as of today more compared to ethnic and that is also having an impact on the ethnic piece altogether from a women's volume share perspective? Yeah, sure. See, Ankit, I think when we speak to all our channel partners who are selling both western and ethnic, while they are seeing a delta difference in, you know, growth between the two channels very clearly, I think for most of the people, while western wear has increased, overall women's wear share has come down. Suppose just to give you an idea that if the shift was 50/50 and the total women's wear market was 20, the market itself has come down 18 and then probably western wear has become a 55% share. That is something which we have seen. I think that still doesn't explain why the overall women's wear share has come down. It's not like, you know, everyone moving to western, but probably again, consumption of ethnic is not happening right now. Sure. Sir, in the month of April, when the numbers were, you know, slightly ahead of pre-COVID, was the footfall number also equal to pre-COVID or even then the footfall was cycling low? Ankit, actually at a company level, we have not been tracking footfalls on a historical basis. On this, any answer I would give you would be very, very judgmental. I don't have that data point. But if you look at even our counterparties like LFS and all, I think the footfalls also increased for ethnic and conversions anyways. I don't think conversions have come down in the past. Sure. That's helpful, Anant. Thank you so much. Thank you. The next question is from the line of Rakesh Wadhwani from Monarch Networth Capital. Please go ahead. Hi, sir. Thanks for the opportunity once again. Sir, just wanted to know, like, when do you expect we'll be reaching the store, per store revenue rate, to the pre-COVID level? Because, I alluded to the previous participant, like we have a lesser revenue pre-COVID per store. When do you think it will be achieved to the, like pre-COVID, and what will be the excess you expect, once we reach there? See, this is something which, you know, I just explained. Two things. Even today when we speak, two regions are already ahead of pre-COVID levels. Even in our network we have partners, we have channels, and we have regions which are tracking ahead of pre-COVID. I think it's about two big regions, especially for us, to come back to those levels. See, my guess is, with festive we should see a big upswing. Now, how much that would translate to in terms of sales to sales growth is something that we'll see. Looking at other categories, I think it should at least be a double-digit number. Okay. That's it. Thank you. Thanks. Thank you. Participants, if you wish to ask any questions, please enter star and one. The next question is a follow-up question from Jignesh Kamani from GMO. Please go ahead. Jignesh, your line has been unmuted. Please proceed with your question. Yeah. Hi. I just want to know about the inventory level currently, and how it is compared to YOY and compared to 1Q FY 2018-2020? Jignesh, again, you know, in the COVID period we really optimized inventory and we bought less. That's what I was saying when, you know, even in FY2022, the season that we gone back, I think we took a more conservative approach. Now we have started investing and, we have also forwarded our inventory by a month or two so that we are able to launch the season on time. Obviously, inventory levels have been built up. It's significantly higher to prepare for the upcoming festive season, or it's just marginally higher than some? No, no. Of course, what the kind of revenues we are targeting in monsoon festive is far higher than the earlier numbers. Obviously there is an equivalent pick up on the inventory built up also. Okay. Chance of us losing out on the revenue opportunity is not significant right now, right? No. This is something which we faced last season, wherein we become more conservative in. This season, both in terms of timing and comprehensive product range, I think we are well covered. Understood. Second thing on the, so earlier we used to not very active on the, you can say, EOSS or we used to reduce number of EOSS days. How is the scenario currently? See, I think, we have always tried to optimize on discounts compared to market. Even this time if you look at it, generally the discount levels are slightly lower than what we have seen in the past years. There would be some savings, but we have not gone, super conservative on this. Still if you compare with earlier seasons, it will still be lower. We have not lost market share because of that, right? Because of our lower discounting policy compared to competitor. No, no. No, that has happened sometime in the past, but this time, that's not the reason. Sure. Okay. Thanks a lot. Thank you. The next question is from the line of Deepak Mehta from Individual Investor. Please go ahead. Yeah, good evening, sir, and thanks for the opportunity. Great set of numbers. My question is around the advertising. I have not seen the, you know, advertisements of our brand in TV or social media. What's your strategy for, you know, brand awareness so we can gain market share, sir? See, for the first time, we are coming up with digital first campaign and we'll be using digital media as the key channel for new season launches. Apart from that, we have also done significant tie-ups with leading channel partners, again, after a long time. You will see us very prominent in many point of sale. As a company, you know, we have a huge advantage in terms of our EBO presence, and we have some really landmark locations across airports and main high streets. That also we use very effectively for communicating to customers. Project Tribe is also a great marketing tool for us. Overall, we'll be upping the marketing spends. We'll be using both traditional and new-age media, and you'll see multiple product campaigns coming up this year. Okay. If I can, yeah, check in one more question? Yeah, please. My question would be, you have already mentioned that most of our, you know, products are targeted for festival, not for high-end or marriage or you can say other family events. Are you planning to enter in that market like marriage or this? No. As of now, there is no such plans. Obviously, there will be some upgradation which will happen in Wishful, but as of now, there's no plan to get into the wedding wear kind of market. Okay. Thank you so much, sir. Best wishes for the coming quarters. Thank you. The next question is from the line of Devanshu Bansal from Emkay Global Financial Services. Please go ahead. Hi. Thanks for this wonderful opportunity. Anant, I just wanted to check on a commentary related to two regions sort of being higher and the other two sort of being relatively lower. This is for Q1 or this is for Q2 so far? No, this has been since beginning of Q1, and this continues. Two regions have been more or less, you know, sufficiently ahead of pre-COVID numbers. We started seeing this happening in April, May, and it continues now also. The good thing is other two regions we are seeing catching up happening. Anant here, I wanted to check a significant portion of your festive sales would also sort of happen in Q2, right? Because of B2B sort of portion of our revenues. Does that gel with your commentary related to double-digit expectations? Sorry, I didn't get your question. I'm saying a significant part of your sales comes through B2B channels, and those channels would be sort of making the festive purchases in Q2 itself. Since largely if you see on a consolidated level across four regions, it would largely be flattish, as two regions are doing well and two are not doing well as of now. You are sort of indicating that festive would be like double-digit higher than pre-COVID. I just wanted to check, am I sort of looking at it differently or maybe? No, no. I'll just clear the confusion. See, first of all, almost 70%-75% of our business is not B2B. It's B2C. Whether it is SOR, LFS, own stores, B2C marketplaces, they all are like secondary sales business. That's the bigger, that's the bulk of our sales. That's number one. Number two, when we talk about festive, it is not like Q2. It is for Puja. Pujas will start from mid-September, Puja sales, and then it goes till October end, till Diwali. It will cut across two quarters. Third to the point about, you know, the like-for-like sales is what I was saying is what we have seen in other categories and, you know, with this figure coming in, even ethnic should see that. These are the three things I just said. Okay. Got it, Anant. Secondly, your employee expenses were also sort of higher in Q1 versus last many quarters. What was the reason for that? No, if you look at sequential level, you know, apart from increments and some new people joining, I think, sequentially if you look at it, shouldn't look too much. Obviously last year and all we had some salary cuts and, you know, COVID-linked reductions. These are now all off. Okay. Got it. Thanks. Thank you. Participants, if you wish to ask questions, please enter star and one. The next question is from the line of Shivaji Mehta, Individual Investor. Please go ahead. Hi, thank you for the opportunity. Also with the cotton prices seeing a steep fall from almost INR 100,000 a candy to about INR 65,000 a candy, will we be cutting prices in line with this fall or do you hope to retain some part of this? No, see, first of all, if you look at our product ranges, we use multiple fabrics, and a lot of times season on season we also try to play the mix. So overall price impact on our lines are also not to that great extent compared to, you know, a brand or a category where 100% cottons are used. Right now we have taken a single digit kind of price increase, but if, you know, fabric prices come down, then obviously we can relook at the pricing. Sure, sir. That's all from my end. Thank you. Thank you. Participants, if you have any questions, please enter star and one. As there are no further questions, I would now like to hand the conference over to Mr. Anant Daga for closing comments. Thank you everyone. We take this opportunity to thank you for joining the call. We hope we have been able to answer all your queries. For any further information, please do get in touch with us or SGA. Have a nice evening, a great weekend. Take care and stay safe. Thank you. Thank you. On behalf of TCNS Clothing Co. Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.